In a brief published May 29, 2025, we released estimates of the likely impacts of the house-passed reconciliation bill and the elimination of enhanced premium tax credits (PTCs) on health care spending and uncompensated care costs over the next 10 years based on uninsurance projections from the Congressional Budget Office (CBO) and data from Health Insurance Policy Simulation Model (HIPSM). In this brief, we use updated CBO projections of the increase in the uninsured associated with the House-passed reconciliation bill and a revised methodology that leverages new analysis from our HIPSM model to produce state-level estimates on the likely impact of these policy changes on health care spending and uncompensated care sought by the uninsured.

Why This Matters

The reconciliation bill would impose federal funding cuts on Medicaid and the ACA Marketplaces. With significant cuts to the Medicaid program and ACA Marketplaces potentially on the horizon, the data presented here can help state and local policymakers and stakeholders consider the potential adverse effects on health care coverage, access, and affordability, and the financial vulnerability of certain providers in their states.

What We Found

We find that if the reconciliation bill were to be enacted and enhanced PTCs were to expire, the increases in the number of uninsured projected by CBO would lead to the following nationally:

• Spending on health care services would decrease by $1.06 trillion between 2025 and 2034 from all payers under the house reconciliation bill and the expiration of enhanced PTCs, with 40 percent of the decline attributable to hospitals ($424 billion), 11 percent to physician services ($120 billion), 26 percent to other services ($275 billion), and 23 percent to prescription drugs ($241 billion).
• From the House reconciliation bill’s provisions alone, there would be a $797 billion decline in health care spending. From the expiration of the enhanced PTCs, there would be an additional $262 billion decline in health care spending over 2025–34.
• Uncompensated care sought by the uninsured would increase by $283 billion over 2025–34 under the House reconciliation bill and the expiration of enhanced PTCs, with $85 billion for hospital services, $34 billion for physician services, $108 billion for other services, and $56 billion for prescription drugs:
• The House reconciliation bill’s provisions would cause an increase of $204 billion in demand for uncompensated care between 2025 and 2034. The expiration of the enhanced PTCs would cause an increase of $79 billion in demand for uncompensated care over this 10-year period.

At the state level, we find the following:

• More than one-third (36 percent) of the total projected decline in health care spending from the reconciliation bill is concentrated in California ($100.0 billion), Texas ($67.5 billion), New York ($61.6 billion), and Florida ($55.8 billion).
• Spending declines associated with the reconciliation bill would be more than $20 billion in nine additional states (Arizona, Georgia, Illinois, Indiana, North Carolina, Ohio, Oregon, Pennsylvania, and Washington), between $10 billion and $20 billion in nine states (Colorado, Louisiana, Maryland, Michigan, Minnesota, Missouri, New Jersey, Oklahoma, and Virginia), and between $1.3 billion and $10 billion in the remaining 28 states and the District of Columbia.
• Spending declines associated with the expiration of enhanced PTCs would be largest in eight states that have not expanded Medicaid (Alabama, Florida, Georgia, Louisiana, Mississippi, South Carolina, Tennessee, and Texas), representing more than two-thirds (69 percent) of the total spending decline associated with the expiration of enhanced PTCs.
• The increases in uncompensated care demand across states are similar to the patterns observed for the spending declines. For example, the largest increases in uncompensated care demand under the reconciliation bill would be concentrated in the four most populous states, California ($27.5 billion), Texas ($15.9 billion), New York ($13.1 billion), and Florida ($11.7 billion).
• Similar to state-level spending patterns, the expiration of the enhanced PTCs would lead to increases of uncompensated care demand of $14.8 billion in Texas and $10.2 billion in Florida, the two largest nonexpansion states.

How We Did It

Our approach involved combining the CBO’s updated June projections totaling a 16.0 million increase in the number of uninsured individuals associated with these changes, with per newly uninsured revenue and uncompensated cost estimates from HIPSM analyses. Estimates are allocated across states based on distributional information from CBO and HIPSM. These dollar amounts capture spending by all insurers—public and private, state, and federal—not just spending from the federal government.